New York's Cooperative and Condominium Community

Habitat Magazine Business of Management 2021




Amalgamated Housing Co-op Meets a Chimney Challenge

Bill Morris in Bricks & Bucks on February 4, 2021

The Bronx

Amalgamated Housing Corp., capital projects, chimney, contingency fund.

The unpleasant surprise in the chimney (left) at Amalgamated Housing Corp.

Feb. 4, 2021

In his 10 years as property manager at the 1,486-unit Amalgamated Housing Corp. co-op in the Bronx, Charles M. Zsebedics has overseen an array of repairs to the 11 buildings that comprise the oldest limited-equity co-op in the nation – to roofs and parapets, facades, garages and more. The one lesson he has learned about capital projects is to always expect the unexpected. “There’s only so much planning you can do,” he says. “There’s no crystal ball.”

That hard-won lesson was reaffirmed when the co-op board undertook an extensive new round of projects that includes replacing the three 70-year-old boilers with two new dual-fuel boilers, cleaning the two 20,000-gallon underground oil tanks, and installing a combined heat and power, or cogeneration, system. The expected price tag was $7.5 million. To cover the cost, the board took out a $14 million second mortgage from National Cooperative Bank (NCB) and secured a $6.7 million state subsidy.

The surprises started right away. When crews got ready to clean the insides of the oil tanks, they discovered that the linings were peeling off, which turned a routine maintenance task into a major repair. When crews removed the old boilers, they discovered that the boilers had sat above concrete pits that filled with water from an underground river; the water was pumped out, and the pits were filled with concrete. Then came the big surprise: Zsebedics alerted crews to cracks in the masonry on the rectangular brick chimney that rises 15 feet above the roof of Building 8. Investigation revealed that the chimney was, to put it kindly, not well made. Instead of the required layer of fire bricks on the interior of the chimney, masons had installed regular red bricks. When these were removed, the mid layer of the three-brick-thick chimney showed gaps, broken bricks and brickwork improperly tied together.

The whole job had to be shut down while the chimney was dismantled and rebuilt. When it was removed down to the roof level, crews got yet another surprise: the fire bricks were in terrible shape for about 30 feet below roof level. “The masons did a lousy job,” says Ron Mineo, a principal at the engineering firm Genesys. “The mortar had deteriorated to the point that you could remove the fire bricks by hand.”

After the faulty fire bricks were removed and the chimney was rebuilt, the interior was coated with a fire-resistant coating called ChimneyCrete. While the work was under way, a temporary backup boiler was brought in at a cost of $26,000 a month.

“Among all the shocks, that was probably the biggest,” Zsebedics says of the chimney. “It delayed the overall project, and we had to pay for the temporary boiler for almost a year. In total, the change orders added about $1 million to the overall project.” The co-op board had to take out a $3 million line of credit from NCB last year to address what Zsebedics calls “hidden conditions that no one could anticipate.”     

With the chimney surprises addressed and the overall project nearing completion, the engineer and the property manager have some advice for co-op and condo boards. “A board member asked me if this chimney was unusual,” Mineo says. “I said, ‘No, this happens on every job. Surprises are not surprising on construction projects.’ We recommend that boards set aside a 10% contingency fund for every retrofit project.” 

Zsebedics agrees: “If you don’t have sufficient contingencies in place, you’re going to be scrambling for additional money. Boards have to have the courage to bite the bullet and have the funds in place to deal with any sort of surprise.”

PRINCIPAL PLAYERS – ENGINEER/CONTRACTOR: Genesys Engineering. GENERAL MANAGER: Charles M. Zsebedics. SUBCONTRACTORS: AKS Mechanical Services; Chimney Doctors. CONSULTANTS: Silman Structural Engineers. ARCHITECT: APArchitects.

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